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Tipping fee lowered as facility tries to compete with landfills

Disposing of garbage by haulers who use the resource recovery facility in Newport will get cheaper after a vote by the Washington County Board of Commissioners Aug. 9.

The tipping fee for waste haulers taking garbage to the plant will go down from $38 a ton to $34 a ton Aug. 15.

The move is prompted by simple economics - because it is cheaper to dispose of garbage elsewhere, there has been a considerable drop-off in the amount of garbage delivered to the plant that sorts the garbage, and then burns what it can to make energy for NRG.

According to staff information provided to the Ramsey/Washington County Resource Recovery Project waste deliveries to the plant "are in decline." "Deliveries during six months of 2004 were below deliveries in those same months in 2003. Deliveries in all six months of 2005 have been below deliveries in those months in 2004," the report stated.

For example, in June 2003, 31,888 tons were delivered to the plant. That increased to 34,615 tons in June 2004, but then shrank to 31,528 tons in June 2005.

Part of the problem is the tipping fee, the fee that garbage haulers pay to the facility to unload their garbage trucks at the plant. "The price of dumping continues to go down in the states around us," said Judy Hunter, the county's senior program manager for public health and environment.

While the fees are consistent with other processing facilities, they are higher than the tipping fees at landfills, especially in Wisconsin, where tipping fees can be as much as $8 or $9 a ton less than that at the Newport facility, according to the staff report.

The hope is that lowering the tipping fee will stabilize the amount of garbage taken to the facility this year, and increase it in subsequent years. This is especially important in the future, as it is planned to turn the plant into a "merchant" facility in 2007, "one in which the facility owner/operator directly seeks waste at a competitive price in the market place," according to the memorandum presented to the board.

"I wish there were a short, easy way to explain this," said Commissioner Richard Stafford, District 5. "We have some people in the [garbage] industry who make more money off the product by putting it in the ground," he said, rather than attempting to recover what's possible from the garbage.

At the same time, the public is subsidizing the operation at the rate of $5 a ton, to redirect the waste to the Newport facility. In Washington County, that is collected through the county environmental charge (CEC) that is a 39.5 percent charge on garbage service.

While commissioners could see the immediate need for a tipping fee increase, the real concern is how it affects business in the future.

"My concern is in 2007 - we might be back again" trying to address the same issue, said Commissioner Gary Kriesel, District 3. "What is the price we want to pay to protect the environment," he said. As long as there is a less expensive place to tip garbage, there will be constant competition to keep the fees low. "I don't understand where this is all headed. I have a real problem lowering this," he said. "As long as we're going to be in competition with landfills, I don't see how we're ever going to get out from under subsidizing" the garbage processing.

The board approved the increased fee, as well as the annual operating budget for the resource recovery facility. The joint powers agreement with Ramsey County that governs the facility provides that the counties retain the authority to approve the annual budget.

The 2006 budget will be $18.5 million, with Washington County's share being almost $5 million, as Ramsey County is responsible for 73 percent of the budget, with Washington County responsible for 27 percent of the budget.

Only six months of the 2007 budget is included, as that is the year when the facility is scheduled to be turned over as a "merchant facility."